MEPs vote for 6% spending increase

While Chancellor George Osborne was on his feet in the Commons slashing Britain's budget, MEPs in Strasbourg were voting to boost EU spending next year by nearly 6%.

The European Parliament, as expected, ignored warnings that any increase in European spending would be seen as a bit rich in the midst of massive belt-tightening by the very nations that pay for the EU budget.

Member states had asked for restraint and Mr Osborne himself called, unsuccessfully, for a total freeze in the EU's running costs in 2011, saying any rise would be unacceptable when taxpayers are bearing the brunt of national budget cuts.

But MEPs have thrown down the gauntlet by voting to boost the annual EU budget from nearly £108 billion this year to more than £114 billion in 2011 - a rise of 5.9%.

The issue goes now goes into arbitration between MEPs, EU ministers and the European Commission, with this year's budget being rolled over into 2011 if no deal is done by January.

Europe minister David Lidington has condemned the rise as "outrageous", and last month Business Secretary Vince Cable warned of a "backlash" against Brussels unless the EU budget was cut in line with national belt-tightening.

Mr Cable warned in advance: "At a time when national governments, including mine, are having to make very painful cuts in public spending, no one can understand why the European budget is not being subjected to the same discipline."

He added ominously: "There is a big backlash on the way, not only in the UK."

That began soon after the MEPs voted. Hungarian eurosceptic MEP Lajos Bokros, who sits in Strasbourg in the same group as the British Tory MEPs, declared: "Austerity seems to be a taboo subject in the European Parliament. As national capitals look at ways of cutting their own deficits or improving the fiscal situation, it is not appropriate that MEPs ask them to increase their contributions to the EU."

Scottish Liberal Democrat MEP George Lyon agreed, saying: "The EU cannot be immune to the budgetary pressures being experienced by all member states and a 6% increase is simply unjustifiable in the current economic climate. The public will be rightly angered that MEPs have voted to increase the EU's budget on the same day the UK coalition Government sets out how it will begin to put the UK on firm financial ground."